JP Morgan CEO Jamie Dimon got a few nasty phone calls in the wake of his healthcare-focused partnership with Amazon and Berkshire Hathaway announced earlier this year.
In a not-so-subtle nod to the insurance industry, Dimon told attendees at Bernstein Research’s Annual Strategic Decisions Conference that the trio’s effort to reduce healthcare costs for a combined 1.5 million employees didn’t sit well with some industry stalwarts. And they let him know.
“I expect a lot of these people we already do business with to call us up and say, ‘What can we do to help?’” Dimon said. “Quite a bit of them were pissed off. Which kind of pissed me off. They’re going to tell me I can’t do a better job for my employees? Isn’t that what they’re supposed to help me do anyway?” he added.
Shortly after Amazon, JPMorgan and Berkshire Hathaway announced the partnership, the Wall Street Journal reported at least two of the top five health insurers voiced concerns to Dimon. The newspaper also reported that Dimon tempered fears the partnership would become a competitor.
Citing “deep frustration” with the current healthcare system among the companies' top brass, Dimon outlined his chief complaints on Friday, including poor data utilization, overspending on fraud and administrative costs, high end-of-life spending and a failing fee-for-service payment model.
“I could go on and on and on,” he said. “We said, ‘You know what, we’re going to take a crack at it.’”
Exactly how the three companies plan to do that is still unclear. In a letter to shareholders in April, Dimon outlined similar concerns, which drew some mocking responses on social media, particularly his call for a “bipartisan commission” and emphasis on wellness programs.
Dimon provided few additional details about the partnership on Friday other than to reiterate the focus would be on employee satisfaction and ensure healthcare services are better and cheaper. He added that the partnership was on “a 20-year horizon.”
He also noted that high-deductible plans, once thought to be a way to incentivize consumers, have led patients to forgo necessary care entirely. And he pointed to his company’s use of wellness programs to reduce deductibles for lower-paid employees.
In the short term, however, Amazon, Berkshire and JPMorgan plan to put together an “unbelievable team” that will come up with solutions “we couldn’t possibly think of today,” Dimon said.
“The first is to form that team and say, here are the problems and issues, and then let them go about attacking it,” he said.
“They could attack it one drug at a time. They could attack chronic care. They could attack emergency rooms. But they are going to start attacking it and then maybe test and learn and try some really neat things.”